ABA issues guideline for dealing with financial abuse

The guideline has been released to ensure that those experiencing financial abuse - a crime that “negatively impacts a person financially and undermines their efforts to become economically independent” and has “devastating consequences for individuals, families and communities” - are better supported by banks. 

Produced by the ABA in consultation with banks and stakeholders, the guideline outlines the importance of the collective efforts of banks in responding to the challenges of financial abuse, and provides a framework for banks to assist with developing internal policies and procedures to better support abuse victims. For example, the guide suggests that banks have systems in place to keep a customer’s contact information secure and confidential and not require the customer to make direct contact with their abuser.

As well as offering information on staff training to identify the signs of financial abuse to better support customers, and how banks can help their employees who may be impacted by domestic violence themselves.

“Financial abuse is about power, control and manipulation of an individual. Financial abuse often occurs with other forms of violence, including physical violence, intimidation and controlling behaviour,” the guideline explained.

The ABA said that in most instances, banks are only made aware of financial abuse once it has been disclosed, but that it could be difficult for some customers to disclose abuse as they “may fear for their personal safety (and the safety of their children), may feel ashamed or that they will not be believed by the bank”.

Diane Tate, ABA executive director, retail policy, commented: “Customers affected by domestic violence can experience abuse of their finances, such as being forced to take out a credit card or loan in their name, or having money taken from their account without their knowledge or consent.

“It is important that banks do everything possible to minimise the burden on these customers when they are dealing with their bank.

“To help with this, the ABA has developed a new guideline on how bank staff can be more aware of the impacts of domestic violence and understand how to help customers.”

Ms Tate added that it was important banks recognise they don’t need legal evidence of domestic violence, such as an Apprehended Violence Order, to be able to offer assistance to customers, and should “ensure they can offer flexible hardship arrangements to customers who could be managing debts jointly with an ex-partner, and that they can fast track this help”.

[Related: Aussies feeling financial pinch prone to anxiety]